Jobs, Wages, & Unemployment | Media Matters for America

Jobs, Wages, & Unemployment

Issues ››› Jobs, Wages, & Unemployment
  • STUDY: Fox News leads networks in pushing White House's false narrative that Trump tax cuts increased wages

    Fox News’ right-wing propaganda dominated cable news coverage of Trump tax cuts 

    Blog ››› ››› ROB SAVILLO


    Melissa Joskow / Media Matters

    Fox News has relentlessly repeated the false narrative that President Donald Trump’s tax plan, the Tax Cuts and Jobs Act of 2017, either increased wages for workers or was the direct cause of some major companies issuing one-time bonuses to employees. Since Trump signed the legislation into law on December 22, 2017, Fox News hosts, correspondents, and guests have made the claim 248 times. In reality, wages have been essentially stagnant since the tax bill was signed, companies poured the vast majority of their tax savings into stock buybacks, and U.S. dividends hit record highs in the months after the tax bill became law.

    What Republicans billed as a middle-class tax cut has overwhelmingly benefited the richest Americans and wealthiest corporations. Now the GOP-controlled House just passed tax cuts 2.0, which economist Jared Bernstein described as a plan that “doubles down on everything that's wrong with the plan they passed at the end of last year."

    Summary

    Background

    Findings

    Summary

    Media Matters reviewed transcripts of the three major cable networks’ evening news shows beginning at 4 p.m. for CNN and Fox News and 5 p.m. for MSNBC (4 p.m. transcripts of Deadline: White House were unavailable) through midnight each weeknight. We looked for comments on wage increases or bonuses versus comments on corporate stock or share buybacks or dividends in discussions about the tax bill since it passed on December 22, 2017.

    Fox led coverage, with comments spread over 182 segments during the nine-month study period. By contrast, CNN and MSNBC each aired only 29 segments containing comments that this study analyzed. Fox was able to set the narrative by having significantly more coverage of the topic and overwhelmingly pushing the administration’s false talking point that the tax cuts spurred wage increases or bonuses.

    Background

    Prior to passage of the Trump tax cuts, the White House Council of Economic Advisers claimed that the legislation would “increase average household income in the United States by, very conservatively, $4,000 annually.” Council Chairman Kevin Hassett clarified in a Wall Street Journal op-ed that the household income increase would actually be a wage increase: “When profits go up, capital investment goes up, and wages follow. That’s the reason we estimated, based on what has happened around the world, that households will get an average $4,000 wage increase from corporate tax reform.” And the day Trump signed the tax bill, he credited it with encouraging companies to issue bonuses to their workers.

    However, real hourly earnings have been stagnant since the tax bill was signed into law, even declining slightly from August 2017 to August 2018, according to a Bureau of Labor Statistics report issued in September. In August, Pew Research Center released a report showing that real wages haven’t moved in decades. Instead of using their tax cuts for wage or investment growth, companies chose to pour the vast majority of their tax savings into unprecedented stock buybacks, and U.S. dividends reached a record high in the wake of the tax legislation.

    The bonuses were not all what they were promised to be, either -- few employees met the requirements necessary to qualify for the $1,000 maximum bonuses that several large companies announced. Many employees at Walmart, Home Depot, and Lowe’s qualified for only $200-250 bonuses. And AT&T and Comcast announced bonuses to employees in 2017, which allowed them to deduct the cost at the prior 35 percent corporate tax rate rather than the new 21 percent rate of the tax bill.

    The new focus on wage increases at the likes of Walmart -- from $9 an hour to $11 an hour -- obscured the fact that the company had been raising wages for the past few years anyway: In 2015, the hourly wage rose to $9, and in 2016, it rose again to $10. At the same time as news spread of the increase to $11, the retailer announced layoffs of thousands of employees. In the past, Walmart has resisted efforts to increase its minimum wage to $15 an hour.

    Findings

    The facts didn’t stop Fox News from tirelessly repeating the administration line that wages were up and bonuses were issued because of the tax cuts. Fox News hosts, correspondents, and guests have claimed the tax cuts led to higher wages or company-issued bonuses 248 times since December 22, 2017. Fox’s business-focused show, Your World with Neil Cavuto, led the coverage with 78 segments total, including 133 comments made about wage hikes and bonuses.

    This narrative drove the network’s coverage as evidence refuting these false claims was a much smaller fraction of the discussion. Fox commentators correctly noted that wages had remained flat over the last year or that companies had been using the vast majority of their tax savings on stock buybacks or dividends only 57 times over the same nine-month period.


    Melissa Joskow / Media Matters

    On CNN and MSNBC, tax cuts, wage increases, bonuses, and stock buybacks were hardly topics of conversation. Speakers on CNN repeated the White House’s narrative almost as often as others pointed out wage stagnation or stock buybacks. The top CNN show, Erin Burnett OutFront, was emblematic of this pattern, with 14 comments about wage increases or bonuses and 12 comments about stagnant wages or stock buybacks.

    On MSNBC, the administration line on wage increases and bonuses was barely mentioned; comments on wage stagnation or stock buybacks were made three times as often. MSNBC’s top show, All In with Chris Hayes, demonstrated this trend with zero comments about wage increases or bonuses and 12 comments about stagnant wages or stock buybacks.

    Overall, discussions of the tax law on Fox vastly outnumbered discussions on CNN and MSNBC.

    More than three-quarters of Fox’s dishonest coverage occurred during the two months after Trump signed the tax bill. Between December 22, 2017, and January 22, 2018, speakers on Fox made claims that the tax legislation increased wages or caused companies to issue bonuses 99 times. In the following 30 days, the claims were repeated another 92 times.


    Melissa Joskow / Media Matters

    This persistence on Fox drowned out comments on all three networks that correctly identified the country’s consistently flat wages or corporate stock buyback initiatives since the tax bill went into law -- these claims were made less than 20 times in any single 30-day period on any of the three networks.


    Melissa Joskow / Media Matters

    Throughout the course of the study, Fox News completely dominated coverage on wage increases, bonuses, and the tax cuts, misleadingly connecting them over and over while failing to mention that the vast majority of corporate tax savings went into stock buybacks.

    Methodology

    Media Matters searched the Nexis transcript database for weekday evening news shows on the three major cable news networks: CNN, Fox News Channel, and MSNBC. Evening news includes all programs beginning at 4 p.m. and ending at midnight with the exception of MSNBC’s Deadline: White House, which airs for one hour at 4 p.m., because its transcripts are unavailable in Nexis.

    We counted comments that fell into one of three categories:

    1. Comments that claimed that the tax bill had or would increase wages or cause companies to issue bonuses to employees.
    2. Comments that were critical of claims that the tax bill had or would increase wages or cause companies to issue bonuses, including comments that identified anecdotal wage increases or issued bonuses but said those increases or bonuses were a small portion of the tax savings spent by companies; or comments that identified that wages had been flat or stagnant over the last year since the signing of the tax bill.
    3. Comments that identified that stock or share buybacks or dividends were a larger portion of the tax savings spent by companies than any benefits given to workers.

    We defined a “comment” as a single block of uninterrupted speech from a single speaker in the transcript. In the case of crosstalk as identified by the transcript, we coded each speaker engaged in the crosstalk as making a single comment rather than several back-and-forth comments. We excluded comments made in video clips unless a speaker on the program used language that clearly endorsed the comment either directly before or after the clip aired. More than one category may occur in a single comment.

    We excluded comments that merely stated “paychecks would increase” or workers would have “more money in their pockets” and the like since these comments may only suggest that withholding would be less, and therefore, workers would have a higher paycheck; however, these comments do not necessarily suggest that workers’ base wages would increase.

    We designed our searches to look specifically for comments about the tax legislation that fit the above categories. For categories (1) and (2), we looked for the terms “wages,” “earnings,” “money,” or variations of “pay” within 10 words of variations of “increase,” “high,” “grow,” or “decrease” or the terms “up,” “hike,” “more,” “raise,” “rise,” “stagnant,” “flat,” or “lower” or the term “bonus” all within 50 words of the terms “tax” within 10 words of “plan,” “bill,” “reform,” “cut,” or “law” or the term “Tax Cuts and Jobs Act.”

    For category (3), we looked for the terms “stock” or “share” within 10 words of “buyback” or the terms “dividend,” “shareholder,” “merger,” or “acquisition” all within 50 words of “tax” within 10 words of “plan,” “bill,” “reform,” “cut,” or “law” or the term “Tax Cuts and Jobs Act.”

  • Cable news coverage of a national prison strike was pathetic 

    For weeks, the major networks almost completely ignored inmates' stories and demands

    Blog ››› ››› GRACE BENNETT


    Melissa Joskow / Media Matters

    Inmates across 17 states went on strike beginning August 21, protesting abysmal prison conditions, the revocation of inmates’ rights, and exploitative labor requirements, among other issues. Inmates have few outlets to address grievances or abuses, so it’s particularly important that media organizations dedicate time to explaining strikes and the circumstances that motivate them. Unfortunately, cable news failed to offer the latest prison strike -- reportedly one of the largest in American history -- anything close to appropriate coverage.

    A Media Matters study found that cable news covered the strike for just ten and a half minutes in total. MSNBC covered the strike for less than eight minutes from August 21 through September 9, while Fox’s coverage didn’t even make it to three. CNN failed to mention the strike even once during that period.

    Fox’s coverage of the strike was limited to one edition of Fox & Friends First, and it was framed entirely around Donald Trump’s supposed support for prison reform. Co-host Jillian Mele noted that inmates were striking and then immediately said, “The president has been pushing for prison reform, and the issue has received support from both parties. So can the president get a bipartisan win?” One of the chyrons that appeared during the segment read: “Trump has pushed for prison reform.” The Department of Justice, in fact, has supported (and rewarded) the use of private prisons -- institutions that profit off of incarceration and lack almost any accountability. Under Trump, the DOJ has additionally attempted to institute harsher federal policies on marijuana in states where it is legal to use and produce and has rescinded guidances on avoiding unfair mandatory minimum sentences and not jailing poor people simply because they cannot afford court-related fees. Trump himself has suggested that drug dealers receive the death penalty, encouraged police officers to injure suspects, and refused to sign on to a Republican-crafted prison reform bill.

    MSNBC’s coverage -- which consisted almost entirely of a single segment on PoliticsNation with Al Sharpton -- featured Darren Mack, a former inmate and prison reform advocate. This segment discussed the strike leaders’ major demands, the poor treatment of inmates, and the racist origins and practices of the U.S. criminal justice system. MSNBC’s only other coverage of the strike was a passing mention on All In with Chris Hayes.

    None of the networks quoted current inmates or the leaders of the movement, whose voices are pivotal to understanding the strike and the greater reality of inmates’ lives.

    The underreported strike came two years after the largest prison strike in American history (another event that went unnoticed by mainstream outlets), and it encouraged inmates across the country to participate in work stoppages and other means of peaceful protest. This latest action was partly inspired by a brutal prison riot in South Carolina that left seven inmates dead and more than a dozen injured. Corrections officials blamed the violence at Lee Correctional Institution on a dispute over “money” and “territory,” but in an op-ed for The New York Times, historian Heather Ann Thompson reported that inmates told her corrections officials provoked the violence by housing rival gang members together. Thompson also reported that “officials’ increasingly punitive policies … exacerbated tensions on the inside.” Amani Sawari, a spokesperson for the strikers, told Vox that inmates at the Lee Correctional Institution “were placed on lockdown all day. They weren’t allowed to eat or use the bathroom. They were placed in units with rival gang members. And then their lockers were taken away, so they didn’t have any safe place to put their personal belongings, which really aggravated and caused tensions among prisoners — to the point where fights broke out, inevitably.” When the riot began, corrections officials failed to break it up, leading to the deaths of seven men.

    The violence at Lee Correctional Institution is far from an anomaly in the prison system of the United State -- the most incarcerated country in the world -- and prison activists listed “immediate improvements to the conditions of prisons and prison policies that recognize the humanity of imprisoned men and women” as the first of 10 demands for the strike. Other demands included the restoration of inmates’ and former inmates’ voting rights (34 states prohibit people from voting on the basis of prior convictions), better access to rehabilitative programs, an end to the racist targeting of minorities by police and prosecutors, and an “immediate end to prison slavery.”

    The term “prison slavery” refers to the exploitative practice of forcing the incarcerated to perform labor for little or no payment. Prison labor is essential to manufacturing numerous products, including blue jeans, car parts, and even military and police equipment. Just last month, the California Department of Corrections and Rehabilitation bragged that over 2,000 inmates had been called on to help fight the state’s devastating wildfires. They were paid $2.56 a day, plus one extra dollar per hour for dangerous and difficult labor that left at least two inmates dead. Perhaps most cruelly, even though the state has invested time and resources in developing skillful firefighters, almost no inmates are able to seek employment as a firefighter following release due to their felony convictions.

    The strike ended on Sunday, Sept. 9 -- the 47th anniversary of the 1971 Attica prison uprising. Prison activists finished with a final push to restore voting rights for people convicted of felonies. Although the results remain to be seen, the strike’s effectiveness was almost certainly undermined by the paltry coverage inmates received from cable news networks.

    Methodology

    Media Matters searched the iQ media video database’s transcript and closed-captioning archive for any instance in which the word “prison” was used within 20 words of “strike” between August 21 and September 9 on CNN, MSNBC, or Fox News.

  • Fox claims wages are going up. They're actually falling.

    Average “real wages” are falling because growth isn’t keeping up with inflation 

    Blog ››› ››› GRACE BENNETT

    Fox Business host Stuart Varney appeared on Fox & Friends to mislead viewers about economic growth under the Trump administration, claiming that, “wages [and] salaries are going up for the best increase in at least a decade,” and asserting that “if you have a skill that’s in demand … your wages, salaries are going up.”

    From the August 20 edition of Fox News’ Fox & Friends:

    According to The Washington Post, however, any apparent increase in wages is being wiped out by a larger increase in inflation. Once inflation is taken into account, the average U.S. “real wage” is actually decreasing, falling to “$10.76 an hour last month, 2 cents down from where it was a year ago.” In addition to falling wage growth, workers must grapple with “with higher prices giving [them] less buying power than they had last summer,” according to The New York Times. The Times also reported on the concerning disparity between corporate profits and workers’ gains, noting, “Corporate profits have rarely swept up a bigger share of the nation’s wealth, and workers have rarely shared a smaller one.”

    Varney’s claim that supposed wage growth is “the best increase in at least a decade” is misleading on two fronts: Average wages have fallen over the past year once inflation is accounted for, and wage growth is increasing at a slower rate than in November 2016, according to the Federal Reserve Bank of Atlanta’s wage growth tracker.

    Unfortunately, this is isn’t the first time that Fox has attempted to mislead the viewers about wage growth or the Trump economy.

  • Fox is deceptively hyping GOP’s next tax bill that just benefits the ultra rich

    Blog ››› ››› ZACHARY PLEAT


    Melissa Joskow / Media Matters

    Back in December, when President Donald Trump signed into law changes in U.S. tax policy, Fox News helped Republicans spin the discussion surrounding the legislation by hyping anecdotal reports of bonuses, wage hikes, and investments. Now that Republicans are aiming to make the individual tax cuts permanent, Fox is at it again -- despite analyses showing how staggeringly disproportionate the benefits are for the wealthy and large businesses, that they barely lower tax burdens for some middle class and lower income families, and that they have had no noticeable positive effect on the economy.

    The law, officially titled the Tax Cuts and Jobs Act (TCJA), passed in December, and Fox hosts celebrated the legislation’s passage after contributing their own dishonest coverage. Fox News shows repeatedly focused on announcements of bonuses -- such as some AT&T workers receiving a $1,000 bonus their union already negotiated -- and small wage increases from some companies to portray the tax cuts as beneficial for ordinary working Americans.

    Others, including Fox’s Sean Hannity, claimed that the tax legislation would lead to increased investment by corporations, in some cases pointing to anecdotal examples of businesses announcing investments and saying they were possible because of the policy change. Two days after the legislation’s passage, Fox & Friends invited White House special adviser Ivanka Trump on to hype an increase to the Child Tax Credit in the legislation. (According to tax experts, “the expanded child credit will actually provide little relief for some of the lowest-income families.”)

    Republicans are now attempting to pass another tax bill, in part to make permanent the individual tax policy changes in the original law, which expire within 10 years. The White House is portraying a report that House Republicans are planning to advance a bill as “a big win for the middle class.” And Fox News is again helping Republicans with their spin. On July 18, Fox & Friends hosted Rep. Kevin Brady (R-TX), chairman of the House Ways and Means Committee -- the committee the bill would originate from -- who said lawmakers should make permanent “those cuts for middle-class families.” Later on the show, Fox Business host Stuart Varney said: “I think Republicans are setting a tax trap for the Democrats. … Are the Democrats going to vote against something which really supports America's middle class?”

    But as reporting from NPR and experts from the Economic Policy Institute (EPI) and the Center on Budget and Policy Priorities (CBPP) have explained, Trump’s tax cuts provide only minor benefits to the middle class, are geared toward the wealthiest Americans, and are having no noticeable positive effect on the economy.

    Trump tax cuts disproportionately benefit the wealthy

    NPR: Tax cut benefits to middle class are meager compared to those affecting the wealthy. NPR cited a December report from the nonpartisan Tax Policy Center which showed that middle-class households are receiving meager tax benefits from the Trump tax cuts compared to the wealthiest households and that when those benefits expire, middle-class households will earn slightly less income than they did before the tax cuts were passed:

    [NPR, 12/19/17]

    EPI: Republican spin of tax cuts as primarily middle-class benefits “is false.” A blog post by EPI budget analyst Hunter Blair showed that Republican lawmakers’ attempted spin of the Trump tax cuts as targeted to the middle class “is false.” The post showed that the bottom 80 percent of taxpayers earn a disproportionately small benefit from the policy change, with the top 5 percent earning a larger share of the benefits relative to their income:

    [Economic Policy Institute, 4/13/18]

    CBPP: Trump tax cuts deliver largest benefits to the wealthiest while boosting income inequality. The CBPP explained in an April report that Trump’s tax plan “will increase income inequality since it delivers far larger tax cuts to households at the top, measured as a share of income, than to households at the bottom or middle of the income distribution”:

    [Center on Budget and Policy Priorities, 4/9/18]

    CBPP: Increase in Child Tax Credit skews toward the wealthy. The CBPP report explained that “10 million children under age 17 in low-income working families will receive no CTC increase or a token increase of $75 or less.” Further, the law increased the upper limit for the Child Tax Credit from $110,000 in income annually to $400,000, with the wealthiest getting an increase worth several times more than the increase middle-class families will receive:

    [Center on Budget and Policy Priorities, 4/9/18]

    Data so far show Trump tax cuts having no positive effect on the economy

    EPI: “There is no evidence that wage growth has materially picked up since the TCJA’s passage.” In June 1 testimony submitted to the House’s Tax Policy Subcommittee, EPI explained that “there is no evidence that wage growth has materially picked up since the TCJA’s passage.”

    [Economic Policy Institute, 6/1/18]

    Bloomberg’s Noah Smith: Federal Reserve data and PayScale index show wages fell after Trump tax cuts took effect. In a July 18 Bloomberg column, Noah Smith pointed to Federal Reserve and private sector data to show that wages actually declined since the Trump tax cuts were passed:

    [Bloomberg, 7/18/18]

    EPI: Bonuses were overhyped, and they are less likely to occur in future years. EPI’s testimony explained that “nearly 40 percent of American workers get bonuses every year,” and that there was a financial incentive to give bonuses after the law’s passage at the end of 2017 when such bumps could be less expensively written off on corporate tax filings. As EPI explained: “What this means is that even if some increase in bonuses occurred in 2017 because of the TCJA (this remains a big ‘if’), there is no reason to think such bonuses will recur in the future.” [Economic Policy Institute, 6/1/18]

    EPI: “There is no serious evidence that the TCJA spurred a notable pickup in business investment.” EPI’s testimony showed that business investment has grown less than it did in either 2011 or 2014. “In short, we do not yet have economy-wide data showing a rapid upsurge of investment due to the TCJA.”

    [Economic Policy Institute, 6/1/18]

  • Black man's work, white man's credit: Fox’s Stuart Varney credits Trump for an Obama-era economic trend

    Varney claims April 2018’s record median household income is a stark contrast compared to “a dead flat line” under Obama, except the upward trend began in 2014 thanks to Obama.

    Blog ››› ››› BOBBY LEWIS

    On the May 24 edition of Fox News’ Fox & Friends, Fox Business host Stuart Varney trumpeted a report showing last month had the highest median U.S. household income since January 2000, which Varney called a “direct result of President Trump’s policies.” However, the growth seen under Trump is a continuation of a trend begun during the Barack Obama administration -- even though Varney falsely claimed there was no household income growth under Obama.

    STUART VARNEY (HOST, VARNEY & CO.): President Trump's growth policy, his growth program, is working. We are gradually returning to prosperity. And it is the direct result of President Trump's policies. He has gone for tax cuts, he has gone for deregulation, and he has turned the economy around. And with it, he has turned around that feeling of prosperity that households have. That graphic you just showed: January 2017, $59,400 median household income. Half the population more, half the population less. OK. Fast-forward to April 2018, you’re up $2,000 per household. Three percent higher in, what, 15 months. That compares to a dead flat line throughout the eight Obama years. We are returning to prosperity because of President Trump's policies.

    Varney’s bizarre claim that median household income was “a dead flat line throughout the eight Obama years” is a fabrication. Household income fell because of the George W. Bush-era Great Recession, which Obama’s policies began to reverse. The median household income Varney congratulated Trump for is the latest data point in a consistently upward trend that began during the Obama administration, in late summer 2014. More broadly, data shows that median household income has generally been trending upward since summer 2011. 


    Image via TalkMarkets

    As The Washington Post’s Nicole Lewis explained in December 2017, members of the Trump administration, including Trump, like to brag about the economy and assign him outsize credit for it. However, due in part to the complexities of the economy and the pace of rolling out presidential policy, Trump’s economic policy has yet to fully impact the nation, whereas “we are probably still feeling the effects of policies laid out by the previous administration.” 

    Regular readers of The Fact Checker know we automatically award Two Pinocchios to anyone (editorials included) who gives sole credit to a president for economic improvements. That’s because the U.S. economy is complex, and the decisions of companies and consumers often loom larger than the acts of government.

    Moreover, it usually takes time and effort for presidential policies to work their way through the country. One year into the presidency, we are probably still feeling the effects of policies laid out by the previous administration.